Lesson 6: Economics Basics

Societies must answer three basic economic questions. Which of the following is NOT one of those questions?

• What goods and services should be produced?

• Where should consumers buy products? In store or online?

• How should goods and services be produced?

• Who uses or consumes those goods and services?

The factors of production are

• Land

• Labor

• Capital

• Government

What term is defined here?

The desire for a certain good or service

People or businesses that buy, or consume, goods or services are

• Consumers

• Producers

• Citizens

• Presidents

People make economic decisions based on their group’s customs and values - usually involves hunting or farming

• Traditional Economy

• Market Economy

• Mixed Economy

• Command Economy

Which characteristics describe a COMMAND economy?

• Government regulation

• Low unemployment

• Economic freedom

• Innovative technology

Which economic system is described here:

Advantages: Freedom of choice, but with some protection

Disadvantages: Some regulations or higher taxes

• Traditional

• Market

• Mixed

• Command

Which characteristics describe a MARKET economy?

• gaps between rich and poor

• freedom of choice

• no protection for consumers

• also called capitalism

PRODUCERS are people or businesses that make and sell goods or services.

• True

• False

What term is defined here?

The ability and willingness to produce a good or service.